The latest Census data on health insurance coverage released last week contained some interesting insights into the health of Georgia’s health care financing system. The good news is that the number of Georgians without health insurance did not grow between 2010 and 2011. However Georgia still ranks 7th in the nation in the percent of its citizens who are uninsured, and 6th in the number of uninsured.
Fewer Georgians had private health insurance in 2011 than they did in 2010, but the change was not the result of further erosion of employment-based coverage; at least not directly. There were fewer Georgian’s working in 2011 than in 2010, but the percentage of Georgians with employment-based coverage did not change. This implies that the Georgia net job loss were for jobs that did not offer health insurance .
Private coverage fell in large part because those who lost their jobs at the beginning of the recession in 2008 and 2009 lost their COBRA coverage in 2010. The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) allows employees separated from their jobs to continue on their former employer’s health insurance plan as long as they pay up to 102% of the premium. For employees who are laid off COBRA benefits generally last 18 months. The American Recovery and Reinvestment Act of 2009 (ARRA) reduced COBRA premiums and extended duration of COBRA coverage. The number of Georgians reporting that they had individual coverage jumped by about 200,000 between 2008 and 2010. The new Census data shows the number Georgians with individual coverage has fallen by about 200,000 in 2011.
So if these folks lost their coverage why didn’t the number of uninsured in Georgia grow? In large part it is because the number of Georgian’s with public coverage, primarily Medicaid, increased by roughly the same rate. It is tempting to speculate that the families of workers who were laid off at the beginning of the recession and were unable to find work before their COBRA coverage ran out saw their incomes fall into Medicaid eligibility. It is impossible for the census data to know how often that scenario played in reality. All the Census data tells us for sure is that more Georgians enrolled in Medicaid in 2011 than were enrolled in 2010.
The sources of health insurance coverage (and therefore health care financing) have historically changed with the business cycle. Economic growth lifts incomes and decreases Medicaid enrollment. Since 1982 periods of strong economic growth has slowed or stopped the erosion of coverage through employment, but it haven’t been characterized by significantly reduced numbers of uninsured.
The Affordable Care Act will significantly change the sources of health insurance coverage for Georgians. However, even at this late date there is a great deal of uncertainty on the distribution of coverage in Georgia in 2014.
That distribution of coverage is a picture of the health care financing system. It describes not only who pays for care, but what is paid to providers. To the extent that families actually did move from employment-based coverage to COBRA to Medicaid as a result of the Great Recession where they sought care, the quality of their care, and the reimbursement for that care also moved.